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Puckett: Spending 'right' on K-12 education

It’s August, which for most school districts and local governments means it’s time to put the budget knives away and live with whatever decisions have been made. It’s also time to remember an important lesson: how a school district spends money is just as important as how much it spends.

For roughly 40 years, K-12 student performance has barely budged in the United States, though inflation-adjusted spending has doubled. Math and literacy test scores for U.S. students at age 17 have remained flat since the 1970s. And on most international measures, we’re moving down.

Consider two U.S. students — one who graduated from high school in 1994, and one who entered kindergarten that year. On average, after adjusting for inflation, $25,000 more was spent on the kindergarten student over the next 13 years (1994-2007) than on the 1994 graduate. Despite this, the younger student’s test scores were no better than the older student’s scores.

Some school systems understand the importance of spending their education dollars efficiently. Using data from the National Center for Higher Education Management Systems and the National Center for Education Statistics, we compared graduation rates in the 50 states over consecutive 10-year periods, 1989-1998 and 1999-2008. We found that the top 25 percent of states in terms of spending efficiency realized an average 1 percentage point increase in graduation rates for each additional $3,000 in per-pupil spending. Comparable spending increases among those in the bottom-performing quartile failed to prevent declines in graduation rates.

Part of the problem has to do with the haphazard way education dollars often are spent.

California, for instance, in 2009 earmarked more than $41 million to hire more gym teachers to fight childhood obesity, though there already were plenty of phys-ed teachers in the state and no evidence that hiring more would reduce obesity.

Another problem with spending practices is that new education initiatives are rarely reviewed for effectiveness after they’re launched — and almost never canceled, even if they have little value.

Rather than focusing entirely on spending levels, policymakers, educators and parents need to start focusing on value: spending that improves educational outcomes.

Consider how we invest in teachers. Currently, seniority-based teacher pay accounts for 10 percent of all U.S. school spending. Yet, longevity doesn’t necessarily assure effectiveness. School districts also reward the attainment of advanced degrees, spending $8.6 billion annually on salary premiums. Yet there is no proven correlation between advanced degrees and teaching quality. At the same time, most school systems invest little time, effort and money in providing teachers feedback that will help them improve their teaching skills.

Although teacher evaluation and pay are politically sensitive topics, changes need to be made.

One of the nation’s largest school districts, Hillsborough County, Fla., for example, recently redesigned its approach. The new system creates a performance-based career ladder. Progress up the ladder is driven by measures of student progress and rigorous classroom observations. The new approach allows outstanding teachers to earn more, even if they’re new on the job.

Another area with great potential is technology. Many school districts use technology to automate or supplement existing practices, much the way early 20th-century factories used electricity to replace gas lamps. What they should be doing is looking for ways to use technology to transform education — extending the reach of top teachers beyond the standard classroom, for instance, or improving student learning through individualized instruction.

Thanks to technology, an excellent teacher with good managerial skills can easily lead multiple classrooms.

A value-based approach to education will not be easy to implement. Spending more is always easier than spending right.

Spending right means making tough trade-offs: Cutting favored initiatives that no longer work, getting more from the same investment and subjecting new spending proposals to the unforgiving value test.

• J. Puckett is a partner in The Boston Consulting Group and co-author of “Achieving More For Less in U.S. Education with a Value-Based Approach.”